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The job of a marketeer is to promote a business and to make sure as many people as possible know about it. This usually comes at a high cost – expensive ad campaigns, flashy billboards, posters, online advertising and so on. Getting your business out there is important. But for small businesses which depend mostly on walk-ins and local business, it can seem unnecessary and expensive for what they get in return.

Marketeers will always tell you to focus on getting more customers, new customers, by offering huge discounts to attract bargain hunters. But is this really good business?

Only an average of 8% of customers acquired through a deal will return to pay full price – and your existing customers are 150% more likely to buy than a new customer when they visit your store. In addition, your regular customers have higher average spend. So what does this mean? That you should listen to marketeers with a pinch of salt – because to focus on your existing customers instead of just chasing new ones is really good business.

Word-of-mouth marketing – the kind money can’t buy

Your existing customers have already chosen you at least once. That means in their eyes, you are already doing something right. Whether they chose you out of convenience or dedicated choice – once they have visited you once, chances that they will return are pretty good. Your job becomes to give them such a pleasant experience that they will want to come back – and tell their friends about you. This is called word-of-mouth marketing. The big brands pay millions for ad campaigns that people start talking about. But the best kind of marketing can’t be bought – an honest recommendation from a friend will beat any shiny poster.

In a bid to up your marketing efforts and grow your business, start with what you have. Do you have 15 customers you see week after week? Strike up a chat. Make them feel special. By giving them a positive reason to talk about you are creating your own, free marketing campaign. Yes, it reaches fewer people – but the people it does reach are so-called hot leads, because the recommendation they receive comes from someone they trust.

Who do you think is more likely to become a customer of yours – the guy who drives home hungrily and sees your half-price food offer, or the girl who has been dragged along by her best friend?

Getting this kind of marketing does take time, but should never be ignored – your reputation is everything.

 

 

Groupon is tempting to many because of the potential of bringing in thousands of new customers. Instead of jumping into it, hoping for the best, here are 6 things to ask yourself before you go ahead to help you prepare for the cost and the benefits.  Read more

The market is saturated with offers and discounts – and consumers are often counting their pennies and scrutinising the various offers before choosing where to spend their money. What it comes down to is where they can get the best deal. So what does that mean for your business?

For many small businesses, competing on price can be detrimental. Groupon is possibly the best known discount-operator in the field – but it may not be the best option for small businesses with tighter margins, smaller footfall and fewer resources. The customers you get at a high cost may never return.

There are many assumptions about Groupon out there – here are some hard facts:

To get your business on their site, you must have an offer with at least 50% off the price. On top of this, Groupon takes 50% of the deal value. So if you discount an item from £100 pounds to £49, you end up with as little as £24.50. Stats have shown that only between 8-20% of customers acquired through a deal return, so you may be paying a high price for a single-visit customer.

It is 7 times easier to make an existing customer return, than to grab a customer from nowhere – in terms of effort, and more importantly perhaps – cost. Add to that – regular customers are less price-sensitive, spend an average of 46% more, and give you high quality referrals. So before choosing to invest in people you have never seen before, you might want to consider the option of focusing on the customers you already have.

 A massive surge in savvy customers – can you handle it?

Groupon, wowcher and the like can give you great exposure. If you are prepared for a surge it can work really well. Your brand gets the attention of many, and a fraction of those may even become regular customers. The risk with a huge surge is that you may get more customers than your business can handle; leaving some customers frustrated and unhappy for one reason or another. They can’t get a table, you are sold out of the dish you are promoting or the item of clothing you have reduced, or your staff is simply unable to tend to everyone. Having unhappy customers venting on social media is almost never good, as it leaves unerasable traces of bad marketing for you.

Using services like these is an approach that should be considered carefully for other reasons too. If you are a high-end brand – there is the risk that selling oneself cheap(er) which can be damaging your brand – customers may like you precisely because you are a more exclusive option. You also risk that your regular customers get angry because they don’t get access to this amazing offer (wouldn’t you, if your regular restaurant cut prices for newcomers but not regulars like yourself?).

Before you decide..

Take your time to consider all aspects – cost and value, pros and cons. If you prepare well, if you have the flexibility in your finances to take a cut that size, and perhaps implement some sort of incentive for your newly acquired customers to come back to you, such as a loyalty program, chances are you will get something out of it. There are plenty of solutions out there, ours included. You can find out more about Loyalzoo’s loyalty solution here.